Companies in Bulgaria will pay 20% less electricity bills next year, regardless of price movements on the energy market, after parliament decided to cap the price at 200 leva (just over 100 euros) per MWh for the entire economy.
Until now, the state reimbursed companies for electricity costs that exceeded the threshold of 250 leva (128 euros) per MWh, which largely protected them from the impact of the energy crisis.
Initially, the deputies considered the proposal to introduce two tariffs for the economy. For customers at low voltage, which is the majority of small and medium-sized enterprises, the upper limit should have been set at 200 leva (102 euros) per MWh, and for consumers at medium and high voltage, (which are the largest consumers), it was set ceiling of BGN 250 (EUR 128) per MWh.
By all accounts, the decision should have positive effects, as it guarantees lower energy costs for the Bulgarian economy and, consequently, a better market position in the coming year. However, it could also have negative consequences.
On the one hand, the state will have to allocate more money to compensate for energy costs, instead of diverting funds to reducing the millions of debts of state energy companies, to maintenance or new investments. On the other hand, it will not stimulate private investments in energy efficiency and own energy sources. Last but not least, lower electricity consumption will certainly not lead to lower final product prices.